The number of complaints lodged with the financial ombudsman jumped sharply last year, with poor levels of customer service and a surge in scams driving much of the increase, a new report has revealed.
While the banking sector prompted most contacts to the Financial Services and Pensions Ombudsman (FSPO) in 2024, it performed better than in 2023, while consumer issues linked to the insurance sector increased by more than 25 per cent year-on-year,
The FSPO concluded a total of 5,907 complaints over the course of the year, up 14 per cent on the previous 12 months.
The FSPO said consumers benefited to the tune of just under €5.8 million as a result of the processes it oversaw, with payouts of almost €4.3 million agreed in mediated settlements through the FSPO’s Dispute Resolution Service.
A further €1 million was offered in settlements during the FSPO’s formal investigation process, including €309,000 directed as compensation in legally binding decisions.
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Consumers and small businesses can lodge complaints that are handled informally at first, and if early interventions do not resolve disputes, the FSPO investigates more formally and issues legally binding decisions, subject only to statutory appeal to the High Court.
It can direct a financial service provider to pay compensation of up to €500,000 to a complainant and/or to rectify the conduct that is the subject of the complaint. There is no limit to the value of the rectification that can be directed.
The majority of complaints received by the FSPO last year concerned the banking and insurance sectors, with 3,404 banking complaints accounting for more than half of all complaints.
That represented a 12 per cent decline in the category when compared with 2023. Complaints relating to the insurance sector rose by 26 per cent to 1,818, the report reveals.
A total of 6,185 complaints was received in 2024, maintaining the high level of complaints from 2023, with almost one in four to do with poor customer service – the most complained about issue last year.
Banking complaints represented 55 per cent of all grievances received and the conduct most complained of in the sector was customer service, while disputed transactions accounted for nearly one third of all banking complaints received. That was up 12 per cent on 2023 as a result of a surge in scams perpetrated against Irish consumers.
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A further 29 per cent of complaints related to insurance products, with grievances most commonly concerning motor insurance and private health insurance.
There were 411 investment complaints in 2024, down 11 per cent on the previous year, while 6 per cent of complaints related to pension schemes.
Maladministration accounted for 59 per cent of grievances regarding pension schemes, significantly ahead of other conducts.
“It is clear from the complaints received in 2024 that some providers have been very successful in reducing the number of complaints received by the FSPO in relation to their services,” said the ombudsman, Liam Sloyan.
“This shows that positive changes that avoid complaints arising or that resolve complaints internally can bring about change that benefits consumers.”
He said providers who had not succeeded in reducing the number of complaints being submitted to the office “should take note of the changes and improvements successfully implemented by providers in their sector and consider what they can do to achieve similar results”.
